Exports, remittances push Pakistan’s current account into surplus in September

ISLAMABAD: Pakistan’s external sector showed encouraging signs in September as the country recorded a current account surplus of $110 million, according to the latest data released by the State Bank of Pakistan (SBP) on Monday.

This marks a notable turnaround from the previous month when the current account showed a deficit of $325 million. A year earlier, in September 2024, the country had posted a deficit of $52 million.

Deficit widens slightly in first quarter

Despite the September surplus, the cumulative figures for the first three months of the current fiscal year (3MFY26) show that the current account deficit has widened by 18.3 percent year-on-year. It stood at $594 million during July to September, compared to $502 million recorded in the same period of FY25.

Trade performance shows mixed picture

Pakistan’s trade indicators reflected both progress and challenges. Exports in September climbed 4.5 percent year-on-year to $3.43 billion compared to $3.28 billion in the same month last year. On a monthly basis, exports were up by 8 percent from $3.17 billion in August.

Imports, on the other hand, rose 6.3 percent from a year earlier to $6.02 billion. However, compared to the previous month, they declined by 1.9 percent, offering some relief to the overall trade gap.

As a result, the trade deficit in goods and services stood at $2.59 billion, up 8.7 percent compared to the same month last year, but narrower by 12.6 percent when compared to August.

Cumulatively, during the first quarter of FY26, Pakistan’s trade deficit increased 9.4 percent to $8.46 billion from $7.74 billion in the same period last year.

Remittances continue to support the economy

Remittances from overseas Pakistanis continued to play a vital role in supporting the country’s external balance. In September, inflows of workers’ remittances rose 11.3 percent year-on-year to $3.18 billion, up from $2.86 billion in September 2024. On a monthly basis, they inched up 1.5 percent from $3.14 billion in August.

During the first quarter of FY26, remittances totalled $9.54 billion, reflecting an 8.4 percent rise from $8.8 billion recorded in the same period of FY25.

Signs of cautious optimism

Economists view the September surplus as a positive development, suggesting that stabilising exports and steady remittance inflows may help Pakistan contain external pressures in the coming months. However, the increase in the quarterly deficit highlights that import payments and the trade gap still need close monitoring.

The SBP figures suggest that while Pakistan’s external position has shown short-term improvement, sustained progress will depend on maintaining export growth, controlling imports, and ensuring consistent remittance inflows.